PMI - Apprenticeships

Marcus Bowsher, Managing Director, FWD Training & Consultancy Ltd, discusses the role of apprenticeships in workplace pensions, the different types of apprenticeships, policy updates to Levy contributions and how to find the right apprenticeship.

PRESENTER: To discuss the role of apprenticeships in workplace pensions, I’m joined now by Marcus Bowsher. He is Managing Director of FWD Training and Consultancy. Well Marcus, we’re here to talk about apprenticeships, but aren’t they really just for school leavers in traditional trades?

MARCUS BOWSHER: Yes, that’s been the case over the years, but there’s been a huge amount of investment into developing apprenticeships to make them much more wide reaching. So if I tell you now that apprenticeships are available for anyone of any age. So from 16 to 65, it’s for new staff and existing staff. And it’s also from entry level GCSE A-level standard right through to degree and master’s levels. And you can do apprenticeships in virtually any role. So the good examples you use, you can actually do apprenticeships now to become a fully qualified lawyer or an actuary or an accountant or a chartered manager. So it’s really opened up the opportunities for employers.

PRESENTER: And what can you do in the pension space?

MARCUS BOWSHER: So, in the pension space, so the way that it works with these apprenticeship schemes is that different sectors and different groups of employers have come together to design new apprenticeship schemes which are specific for their sectors. So in the workplace pensions space there is a new apprenticeship scheme, which is designed at A-level standard effectively. So it can be either for new staff or existing staff at that level. And you can do your professional qualifications through that route as part of the apprenticeship scheme.

PRESENTER: And how is this all paid for, is there a levy or something?

MARCUS BOWSHER: There is, yes. So a levy’s been introduced, and the way the levy works is that any employer that has a payroll bill of more than £3m has to pay into this new levy contribution, which is starting from April of next year. So anyone under the £3m, they would just apply for apprenticeships in the current way, which is making a contribution towards them. But anybody who’s got a payroll of over £3m has got to pay ½% of their payroll into that levy contribution pot. And once they’ve done that the only way of getting value back from that is to use apprenticeships as part of their development programme.

PRESENTER: Now, there’s been some movement on apprenticeships from the Department of Education recently, talk us through the changes there.

MARCUS BOWSHER: Yes, a couple of the key ones that happened just in the last couple of months actually are quite significant. So the first one is they are allowing employers who pay into this levy contribution two years to spend the money, which is fantastic, because you can imagine there could be quite large contributions being paid, and your needs as employer are going to change over that period of time. So having two years to use the money is great. So you can plan ahead, you can react to the changes and the needs that you need within your organisation and spend the money appropriately. The other one that’s particularly significant is that they’ve removed something that they call, it was the prior qualification rule.

So in the old days if you’re a graduate for instance, you couldn’t then become an apprentice at a lower level than graduate level. That’s been taken away, which is fantastic. So effectively it means that any existing employee in an organisation or a graduate that you take on through a graduate scheme can now do an apprenticeship. So if they’ve come in, they may have done history or sports science or whatever it might be at university, and then come into a pensions environment and clearly they need to retrain in something different. So because it’s substantive new skills that they’re getting, they can use the funding from the levy to actually train and get their professional qualifications.

PRESENTER: When is the levy introduced, what can you do to prepare for it?

MARCUS BOWSHER: OK. So from April of this year, April 2017, the levy is going to be introduced. So in that month will be the first month as an employer that I’ll see this ½% deducted from my payroll as this new levy tax. So what I need to do as an employer is start to understand what the impact of that is for me in advance of that. So start to understand how big is my levy contribution, and then look at this wide range of apprenticeships that’s now available, and think about within my business how could I potentially use apprenticeships to help develop both new and existing staff? So it could be down the pensions management route, it could be something more generic like management, it could be something within insurance – a very broad range of apprenticeships are available, so look around your business and start to think about how you can use those to help your development.

PRESENTER: And how can workplace pension employers get more information on exactly which apprenticeships are available?

MARCUS BOWSHER: Well the best thing to do is if you Google trailblazer apprenticeships it’ll take you to the Government’s site of all the apprenticeships that are being developed, right from green keeping through to butchery and financial services and everything in between. So employers have developed specific ones for specific areas. So within financial services you’ll be able to find the workplace pensions apprenticeship. So the workplace pensions administrator/consultant is the one that’s been developed, which is an A-level standard, which also gets you your pension management qualifications as well. So that’s all included within the apprenticeship scheme and fully funded. And what’s coming this year as well, will be available later this year, is a degree level pensions management apprenticeship as well. So that’s being worked on by a group of employers at the moment.

PRESENTER: We have to leave it there. Marcus Bowsher, thank you very much.